Reason 8 – Build safeguards into the contract

Real Estate Business Online reported that actress Toni Collette lost a case in the NSW Supreme Court. For the story, go to:

by Brendan Wong: The couple had signed a contract to buy a double-fronted Paddington terrace  for $6.35 million in October 2011, before backing out on the day it was to be sold. The vendors eventually sold their property for $5.5 million but took Ms. Collette and her husband to court for the loss, as well as interest and land tax.

The Supreme Court ruled in favour of the vendors ordering the buyer to pay to the vendor $814,000, plus deposit and legal costs.

Mr. Tim McKibbin, from the REI of NSW told Real Estate Business that buyers who entered into an agreement were committing to the terms of their contract.

“You acquire some rights under the agreement but you also have some obligations to perform. Obviously the larger the transaction, the more care and consideration you should take before entering a contract. Invariably, dealing with real estate is a serious decision because it has serious implications.”

Mr McKibbin said it was the responsibility of the buyer to ensure they could completely satisfy the terms of a contract before signing it.

RealTeam’s Comment:

Had they engaged a buyer’s agent, this couple would have gained the advantage of professional advice and assistance in selecting the house, & negotiating the price & terms of the contract to buy it.

Their agent would have built safeguards into the contract to protect them as far as possible against the consequences of a possible change of heart during the process toward settlement.

Of course, nothing and no-one can protect a buyer against a last-minute change of plans occurring on the very day of settlement, which may have occurred in this case. But a skilled, experienced buyers agent would have canvassed all the known possibilities beforehand, and discussed exit strategies and contingency responses, by the time the contract was entered into.

RealTeam - Buyer Agent in Adelaide
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